The effects of Hurricane Sandy continue to plague New Jersey homeowners. Many are still not back in their homes and constantly face the threat of foreclosure. A new bill making its way through the state legislature aims to stop foreclosure proceedings for Sandy victims for three years while people work to rebuild their homes.
This bill only affects homeowners who qualify for the Low-to-Moderate Income Homeowners Rebuilding grant program. Due to significant delays, homeowners waiting for funds from that program and the Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) grant program are unable to move forward. As a result, many are struggling to remit rental and mortgage loan payments. Both programs added rental payment assistance in March in recognition of the delays homeowners are facing.
However, that will not necessarily keep mortgage lenders at bay while residents struggle to rebuild their homes and their lives. If the bill passes, an estimated 8,300 homeowners could also receive a three-year forbearance on their home loans, which means that they would not be responsible for making mortgage loan payments during that time. Of course, mortgage lenders oppose the bill saying that they should not have to pay for government inadequacies.
Between the housing market crash and Sandy, New Jersey’s residents have been hit particularly hard. Even if the bill passes, hundreds, if not thousands, of homeowners in New Jersey may not be able to stop foreclosure filings by their lenders. In those cases, filing for bankruptcy might provide the time and space homeowners need in order to save their homes.
Source: nj.com, “3-year foreclosure ban proposed for Sandy-damaged homes“, Erin O’Neill, June 22, 2015